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James Hyerczyk
E-mini Dow Jones Industrial Average Down

December E-mini Dow Jones Industrial Average futures are trading lower shortly after the cash market opening. Traders came into Thursday’s session feeling pretty good after the Federal Reserve cut interest rates by 25 basis points for the third time this year. However, sellers quickly took control of the market after Bloomberg News reported that Chinese officials have been casting doubt over the possibility of a long-term trade deal with the United States.

At 14:58 GMT, December E-mini Dow Jones Industrial Average futures are at 26952, down 180 or -0.67%.

Daily December E-mini Dow Jones Industrial Average

Daily Technical Analysis

The main trend is up according to the daily swing chart. A trade through 27230 will signal a resumption of the uptrend. The main trend will change to down on a move through 26588.

The minor trend is also up. The new minor top is 27230.

The short-term range is 26588 to 27230. Its retracement zone at 26909 to 26833 is the first downside target. Since the main trend is up, buyers are likely to come in on the first test of this area. Today’s intraday low at 26872 occurred inside this zone.

The main range is 27312 to 25703. Its retracement zone at 26697 to 26508 is the next downside target. This zone is controlling the near-term direction of the Dow.


Daily Technical Forecast

Based on the early price action, the direction of the December E-mini Dow Jones Industrial Average the rest of the session on Thursday is likely to be determined by trader reaction to the uptrending Gann angle at 26983 and the short-term 50% level at 26909.

Bullish Scenario

A sustained move over 26983 will indicate the presence of buyers. Overtaking the downtrending Gann angle at 27040 will indicate the buying is getting stronger. This could trigger an acceleration to the upside with the next target angle dropping in at 27176. This is the last potential resistance angle before the 27230 minor top and main tops at 27262, 27312 and 27338.

Bearish Scenario

A sustained move under 26909 will signal the presence of sellers. The next downside target is the short-term Fibonacci level at 26833, followed by a downtrending Gann angle at 26768.

Crossing to the weak side of the downtrending Gann angle at 26768 will put the Dow in a position to challenge the main Fibonacci level at 26697.

Side Notes

Watch the price action and read the order flow at 26904 all session. This is last week’s close. A trade below this level will put the Dow in a position to form a potentially bearish closing price reversal top. This could trigger the start of a 2 to 3 week correction.

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